A thesis submitted in partial fulfillment of the requirements for the degree of Master of Engineering, School of Engineering and Technology

Thesis (M.Eng.) - Asian Institute of Technology, 1992

The Thai construction industry has been greatly developed, and experienced a boom for the fifth consecutive year. Construction of several large projects are being carried out in the both public and private sectors. There are an increasing number of construction contracts resulted in claims and disputes. All of the parties involved in the Thai construction industry are fully aware that disputes not only lead to cost overruns, but can end up as expensive and lengthy courtroom battles. However, very few studies related to construction contract claims and disputes in Thailand have been presented. This study is an attempt to gain further insight to construction contract claims and disputes in the Thai construction industry. This thesis examines the subject-matter of construction contract disputes which were resolved in the Thai courts of law. The data examined include the reasons behind the legal disputes and the legal principles concerning construction contract law. Also, the views and opinions of the experienced persons involved in the Thai construction industry on the frequency and severity of claims and disputes, causes associated with high incidence of claims, dispute resolution procedures, and recommendations for reducing the number of claims and severity of disputes were investigated through questionnaires. Alternate approaches to conciliation and arbitration that currently have been developed in Thailand are described in the study. The study indicates that the largest proportion of legal disputes are pertaining to alleged breach of contract. A knowledge of the legal principles concerning construction contract law and practices is a useful guide on avoiding legal disputes in construction projects. From the questionnaire survey, time problem and changes are the subjects of claims and disputes that most frequently occur, while responsibility for damages to existing or adjoining property is the type of claims and disputes that is the most severe and difficult to resolve. The economic situation is also the important factor leading to high incidence of claims and disputes in construction projects. The great majority of construction contract claims -about 85 percent- can be settled agreeably by negotiations at the project level. Conciliation and arbitration are alternative qispute resolution methods that offer several advantages compared to litigation as follow: (1) privacy; (2) informality of proceedings; and (3) speed and efficiency. The recommendations for reducing the number of claims and severity of disputes can be addressed most effectively by focusing on the critical areas of the practices of the parties involved and of the contracting process.